South Delaware Coors Inc Case Study
2001 South Delaware Coors, Inc. Proforma Income Statement and Accompanying Notes
South Delaware Coors Inc. Pro Forma Income Statement for the 12-Month Period Ended Dec. 31, 2001
Sales
$3,691,963.00
Cost of goods sold
$2,876,039.00
Gross margin
$815,924.00
Marketing Expenses
Sales expenses
$100,000.00
$100,000.00
General and Admin. Expenses
Administrative Salaries
$60,000.00
Dep. on Buildings and Equipment
$50,000.00
Interest expense
$53,981.00
Property taxes and insurance
$20,000.00
Other admin. expenses
$20,000.00
$203,981.00
Net profit before (income tax)
$511,943.00
Notes
Revenues /Sales: Estimated revenues are computed by using a combination of study A, B, C, and I. …show more content…
Case/bottle beer accounts for 75% of consumption and keg beer accounts for 25% of consumption. Thus, 419.54 thousand gallons are from case/bottle beer while 139.85 thousand gallons come from keg beer.
Wholesale price per gallon for bottle/can beer is calculated to be $7.65. We are using $4.32 for the wholesale six-pack price because a perceptual map analysis indicated that Coors, Budweiser, and Miller Lite are positioned similarly in consumers’ minds. Study I shows both Budweiser and Miller Lite pricing at $4.32 for a wholesale six-pack. The wholesale gallon price is obtained by multiplying $4.32 with 1.77 to obtain $7.65.
Wholesale price per gallon for keg beer is estimated to be $3.45 ($7.62 * 0.45) as the case context states that keg beer prices at 45% of the price of bottled
South Delaware Coors Inc. Pro Forma Income Statement for the 12-Month Period Ended Dec. 31, 2001
Sales
$3,691,963.00
Cost of goods sold
$2,876,039.00
Gross margin
$815,924.00
Marketing Expenses
Sales expenses
$100,000.00
$100,000.00
General and Admin. Expenses
Administrative Salaries
$60,000.00
Dep. on Buildings and Equipment
$50,000.00
Interest expense
$53,981.00
Property taxes and insurance
$20,000.00
Other admin. expenses
$20,000.00
$203,981.00
Net profit before (income tax)
$511,943.00
Notes
Revenues /Sales: Estimated revenues are computed by using a combination of study A, B, C, and I. …show more content…
Case/bottle beer accounts for 75% of consumption and keg beer accounts for 25% of consumption. Thus, 419.54 thousand gallons are from case/bottle beer while 139.85 thousand gallons come from keg beer.
Wholesale price per gallon for bottle/can beer is calculated to be $7.65. We are using $4.32 for the wholesale six-pack price because a perceptual map analysis indicated that Coors, Budweiser, and Miller Lite are positioned similarly in consumers’ minds. Study I shows both Budweiser and Miller Lite pricing at $4.32 for a wholesale six-pack. The wholesale gallon price is obtained by multiplying $4.32 with 1.77 to obtain $7.65.
Wholesale price per gallon for keg beer is estimated to be $3.45 ($7.62 * 0.45) as the case context states that keg beer prices at 45% of the price of bottled